WEBVTT - SYSK Selects: How White-collar Crime Works 0:00:00.960 --> 0:00:03.640 Hey, everybody, it's me Josh, your old pal, and for 0:00:03.720 --> 0:00:06.880 this week's s Y s K Selects, I've chosen one 0:00:06.920 --> 0:00:10.520 of those overlook gems from way back in July of 0:00:10.600 --> 0:00:13.200 two thousand twelve, eight years ago. Can you believe that? 0:00:13.640 --> 0:00:17.120 It's how white collar crime works? So sit back, relax 0:00:17.360 --> 0:00:23.119 and learn about how the other half commits crime. Welcome 0:00:23.160 --> 0:00:25.400 to Stuff You Should Know, a production of I Heart 0:00:25.480 --> 0:00:34.040 Radios How Stuff Works. Hey, and welcome to the podcast. 0:00:34.080 --> 0:00:38.320 I'm Josh Clark. There's Charles W. Chuck Bryant uh stipping 0:00:38.360 --> 0:00:44.000 on his laquais uh mineral water. And um, this isn't 0:00:44.040 --> 0:00:47.239 even a sponsored by location and done this like two 0:00:47.280 --> 0:00:51.320 or three times? Yeah, I agree, call us uh. And 0:00:51.440 --> 0:00:53.360 since you put the two of us a couple of 0:00:53.400 --> 0:00:56.880 microphones in an ice cold can of refreshing laqua mineral 0:00:56.920 --> 0:00:59.400 water together, you have something called Stuff you Should Know. 0:00:59.440 --> 0:01:02.840 It's a pod cast. It's a podcast. I'm looking to 0:01:02.880 --> 0:01:06.000 see who makes this actually. Oh no, I thought I 0:01:06.040 --> 0:01:09.200 was gonna say, like Coca Cola and smaller. No, it's 0:01:09.319 --> 0:01:13.320 a Sundance beverage company. Oh yeah, they're huge for Minnesota. 0:01:13.360 --> 0:01:16.800 I think that's perfect. That is a perfect sponsor for stuff. 0:01:16.840 --> 0:01:20.120 You should know a little guy that's producing a great product. Agreed, 0:01:20.560 --> 0:01:25.800 lax uh so chuck, Yes, I've got an intro today. Awesome, misses, 0:01:26.920 --> 0:01:31.920 stop criticizing me. I mean, um so. Very recently, a 0:01:32.040 --> 0:01:39.480 trio of Brits economists British economists dry, They're like walking saltines. 0:01:39.840 --> 0:01:42.640 They're very exciting. Um. But anyway, these guys did something 0:01:42.680 --> 0:01:46.520 pretty cool. They studied bank robberies and their study was 0:01:46.520 --> 0:01:50.160 published in a journal called Significance. It's actually kind of 0:01:50.160 --> 0:01:52.440 a cool journal. It takes statistics and applies it to 0:01:52.520 --> 0:01:56.520 real world stuff, so it's an interesting statistics journal. If 0:01:56.560 --> 0:01:59.040 there is such a thing, um, and if there is, 0:01:59.120 --> 0:02:02.040 this is it. And what these guys found was that 0:02:02.200 --> 0:02:05.040 bank robbery is actually a really terrible way to make 0:02:05.080 --> 0:02:09.840 a living. Yes, I would agree with that morally, Economically 0:02:09.880 --> 0:02:14.120 it's a terrible way to make a living too, the right. Yes, 0:02:14.200 --> 0:02:16.200 they looked at they looked at a lot of variables, 0:02:16.240 --> 0:02:18.680 like the number of people involved, and they found that 0:02:18.720 --> 0:02:22.600 the bigger the gang, the more um, the bigger the hall. 0:02:22.639 --> 0:02:25.840 I guess. But it also meant that's one extra mouth 0:02:25.919 --> 0:02:28.000 to divide up amongst unless you're like one of those 0:02:28.040 --> 0:02:31.079 bank robbers that just kills everybody afterward. Yeah, you don't 0:02:31.080 --> 0:02:32.560 want to get in bed with one of those guys 0:02:32.600 --> 0:02:35.120 like Ben Affleck or like in Heat when there are 0:02:35.120 --> 0:02:37.320 a lot of killing afterward and heat. Yeah, and in 0:02:37.400 --> 0:02:40.359 the town ben Affleck's a recent heist movie. Yeah, a 0:02:40.360 --> 0:02:41.920 lot of killing going on. I was gonna let that 0:02:41.960 --> 0:02:44.240 one walk by, but you brought it up twice. I 0:02:44.320 --> 0:02:48.960 enjoyed it. Um. Oh really uh okay, So anyway, Um, 0:02:48.960 --> 0:02:51.520 there's a lot of variables involved. But what they found 0:02:51.600 --> 0:02:54.480 is no matter what, in the u K. You can 0:02:54.520 --> 0:02:57.560 make off with about thirty one graham. That's not bad, 0:02:57.680 --> 0:03:01.000 per yes, and on average that's what that's what the 0:03:01.040 --> 0:03:04.400 take was. So in the UK it's not so bad. Um. 0:03:04.440 --> 0:03:06.360 But at the same time, thirty one grand what are 0:03:06.360 --> 0:03:08.280 you gonna do with that? Yeah, I mean, if you 0:03:08.320 --> 0:03:10.000 want to live the highlight, you gotta rob like four 0:03:10.040 --> 0:03:13.040 or five banks a year, easy, right or right? Okay 0:03:13.200 --> 0:03:16.160 or um. If you're in the US, you have to 0:03:16.240 --> 0:03:19.600 rob a lot more than that. So the UK suffers 0:03:19.600 --> 0:03:21.600 about a hundred and six bank robbers a year. In 0:03:21.600 --> 0:03:25.800 the US there's twelve thousand, and of those twelve thousand, 0:03:25.840 --> 0:03:29.760 the average take is like four grand. They only have 0:03:29.880 --> 0:03:33.480 how many a year England and six that's amazing. They 0:03:33.480 --> 0:03:36.720 have really stiff, stiff gun laws and I think that 0:03:36.800 --> 0:03:39.400 probably determ bank robbery because you kind of have a 0:03:39.440 --> 0:03:42.320 gun or a note in your pocket and that says something. Well, 0:03:42.360 --> 0:03:44.440 these guys figured out that the presence of a firearm 0:03:44.480 --> 0:03:49.960 increased your takea Um. But anyway, so forty bucks that's 0:03:50.000 --> 0:03:51.800 not much at all now, and about a third of 0:03:51.800 --> 0:03:57.000 bank robberies, I guess in both countries yield nothing zero zero, 0:03:57.240 --> 0:03:59.600 So it's a lot of hard work, a lot of risk, 0:03:59.720 --> 0:04:04.720 for very little gain. The real money is in white 0:04:04.720 --> 0:04:08.880 collar crime. Oh yes, you want to make some cash quick, 0:04:09.560 --> 0:04:12.200 maybe one good heist. It's gonna set you up for 0:04:12.200 --> 0:04:14.480 the rest of your life. And even if you're caught. 0:04:15.200 --> 0:04:17.800 Even if you're caught, the chances are you will have 0:04:17.880 --> 0:04:22.200 a mild, if any, penalty leviating against you. White collars 0:04:22.240 --> 0:04:26.320 the way to go. Yeah, we're talking guys who um 0:04:26.600 --> 0:04:30.400 tell people that they are financial investors and get friends 0:04:30.400 --> 0:04:33.880 and family and uh parents of the little league that 0:04:33.960 --> 0:04:37.839 they coach to give them nine grand. Um. There's other 0:04:37.839 --> 0:04:41.880 guys who just have little penny stock companies that pump 0:04:42.000 --> 0:04:47.360 up their um stock prospects called stock touting, and UM 0:04:47.520 --> 0:04:52.200 dump all of their shares UM. That's investor fraud. They 0:04:52.240 --> 0:04:54.800 make hundreds of thousands, if not millions of dollars. It's 0:04:54.839 --> 0:04:58.719 where the real money is. And historically speaking, it has 0:04:58.839 --> 0:05:02.080 really low risk. Yeah, even if you're caught. All right, 0:05:02.160 --> 0:05:04.760 So we're endorsing white collar crime, we're not endorsing it. 0:05:05.440 --> 0:05:08.400 I was being facetious. Okay, I thought you met up 0:05:08.400 --> 0:05:12.200 with white collar crime in no. No. As a matter 0:05:12.200 --> 0:05:14.880 of fact, it's going down. The times are definitely changing. 0:05:14.920 --> 0:05:17.360 There's a big struggle going on right now is to 0:05:17.839 --> 0:05:21.520 figuring out the just the right amount of punishment with 0:05:21.560 --> 0:05:23.920 white color crime because there's a lot of factors involved. 0:05:24.040 --> 0:05:27.440 It's a lot different from blue collar crime e g. 0:05:27.600 --> 0:05:30.960 Stealing a car, robbing a bank. There's a lot of 0:05:31.000 --> 0:05:35.479 differences that differentiated. Let's separate the two, um. And one 0:05:35.480 --> 0:05:39.520 of those now is the the sentencing forum is probably stiffer, 0:05:39.960 --> 0:05:42.599 which is a total reversal from how it used to 0:05:42.600 --> 0:05:45.039 be before. And they've also closed a lot of the 0:05:45.040 --> 0:05:48.400 club beds down that got so much press. Yes, well 0:05:48.440 --> 0:05:51.680 they've they've changed them. They're still there. They just are 0:05:51.760 --> 0:05:54.800 changed a lot of more shut down like period, Yeah, 0:05:54.960 --> 0:05:59.599 just to ship them to real federal penitentiary penitentiaries, penitentiaries 0:05:59.600 --> 0:06:04.719 and tree. Uh. That reminded me of a word that 0:06:04.720 --> 0:06:06.839 will definitely be hearing at some point in this podcast. 0:06:08.080 --> 0:06:12.080 It's a psi oh, yeah, because that's definitely white collar. 0:06:12.560 --> 0:06:14.760 Part of the problem with white collar crime, Josh, as 0:06:14.760 --> 0:06:17.880 you know from reading this, is that, um it's hard 0:06:17.920 --> 0:06:20.640 to come up with an exact definition of what constitutes it. 0:06:21.080 --> 0:06:23.760 So that's why they have a hard time getting great 0:06:23.800 --> 0:06:27.720 statistics on punishment and finds levied and how many of 0:06:27.720 --> 0:06:32.800 they're catching. But I'm gonna go with non violent crime 0:06:33.880 --> 0:06:36.400 that typically involves and you have to say things like 0:06:36.440 --> 0:06:39.279 typically because it's kind of all over the map, typically 0:06:39.320 --> 0:06:44.400 involves um deceit and fraud given by perpetrator because of 0:06:44.440 --> 0:06:47.359 their occupation. Yeah, And for that reason, a lot of 0:06:47.360 --> 0:06:52.120 times it's called occupational UM crime. Yeah. Uh. And if 0:06:52.160 --> 0:06:53.800 you look at it through that view, which is a 0:06:53.880 --> 0:06:56.560 very broad view of white collar crime, it's not just 0:06:56.600 --> 0:06:59.480 the exacts in the three thousand dollar suits who are 0:06:59.480 --> 0:07:04.159 perpetrated eating this. It's the guy who's stealing pencils from work, yeah, 0:07:04.360 --> 0:07:07.080 or non violent to see. Especially somebody asked him if 0:07:07.120 --> 0:07:09.720 he did it, and he says no, And it's because 0:07:09.800 --> 0:07:14.040 you are you're you're granted this opportunity through your occupation. Actually, 0:07:14.040 --> 0:07:16.640 I would call that petty theft. It's but I'm saying, 0:07:16.680 --> 0:07:19.760 like in a very very broad definition of white collar crime, 0:07:19.840 --> 0:07:22.040 that that definitely counts. But for the most part, when 0:07:22.080 --> 0:07:24.000 you think of white collar you think about the CEO, 0:07:24.120 --> 0:07:28.560 as you think about investor fraud, embezzlement, that kind of 0:07:28.560 --> 0:07:32.400 stuff exactly. Uh, feds have been after in the United States, uh, 0:07:32.520 --> 0:07:35.440 in earnest since nineteen seventy four as far as a 0:07:35.440 --> 0:07:39.200 a dedicated division the FBI. Yeah, and that's because the 0:07:39.360 --> 0:07:42.120 NIX and I read and then uh, despite that about 0:07:42.160 --> 0:07:45.239 three hundred billion dollars a year. And that's a pretty 0:07:45.320 --> 0:07:50.760 rough estimate, that's two estimate. Yeah. So let's talk about 0:07:50.800 --> 0:07:52.960 a few ways you can commit white color crime. Yeah, 0:07:53.080 --> 0:07:57.160 because the definition you gave was like beautiful, it's pretty good. Um. 0:07:57.200 --> 0:07:59.560 And there are some that just like I said, investment 0:07:59.600 --> 0:08:04.760 frau or embezzlement, they're just prototypical. Insider trading is one 0:08:04.880 --> 0:08:09.520 that's a big one, which falls under securities fraud. Right, Uh, Yeah, 0:08:09.600 --> 0:08:12.200 I mean it's a type of securities fraud. So basically 0:08:12.240 --> 0:08:15.600 insider trading. We've I swear we've done something on this, 0:08:15.720 --> 0:08:18.640 I don't think, so it must have been in our 0:08:18.680 --> 0:08:22.440 Fenian Freddie presentation. Then maybe we studied a lot of 0:08:22.480 --> 0:08:25.040 this stuff. Yeah, and I thought we'd done a podcast 0:08:25.080 --> 0:08:28.800 and I guess not. But insider trading is essentially like, um, 0:08:28.880 --> 0:08:31.560 let's say that you and I find out that Discovery 0:08:31.560 --> 0:08:34.360 had an awesome quarter, and so we go and buy 0:08:34.360 --> 0:08:37.560 a bunch of Discovery stock for nothing, and then it 0:08:37.640 --> 0:08:40.160 just shoots through the roof after the stock price comes up. 0:08:40.200 --> 0:08:44.760 That's inside of trading. Sure, that's using private knowledge about 0:08:44.760 --> 0:08:47.719 a publicly traded company for your own game. That's a 0:08:47.800 --> 0:08:51.240 no note. We go to other people that would count 0:08:51.240 --> 0:08:54.719 as well, and then like s Marcus Stewart, Yeah, that 0:08:54.880 --> 0:08:57.520 they took part and then they would be uh insider 0:08:57.559 --> 0:09:00.640 traders as well, exactly. And it works the opposite way 0:09:00.679 --> 0:09:02.280 as well, Like if you find out that there's a 0:09:02.320 --> 0:09:05.480 lot of terrible information, terrible information is going to make 0:09:05.480 --> 0:09:09.120 your stock drop that you sell before that information becomes public, 0:09:09.360 --> 0:09:13.000 you're in trouble, big trouble. Securities fraud, which UM in 0:09:13.040 --> 0:09:15.600 started training is kind of like that, UM, but it 0:09:15.720 --> 0:09:18.760 is also manipulating cooking the books. You've heard that term 0:09:18.800 --> 0:09:24.000 of your own company. Two maybe undervalue UM a stock 0:09:24.120 --> 0:09:27.240 before it goes public or I mean there's all different variations, 0:09:27.559 --> 0:09:31.360 but it basically involves manipulating numbers in a dishonest way, right, 0:09:31.400 --> 0:09:35.360 that pumping up scheme where it's stocked touting. There's that's 0:09:35.440 --> 0:09:40.320 all securities fraud UM. And then there's any trust violations 0:09:40.320 --> 0:09:42.000 for another good one, there's this has been kind of 0:09:42.040 --> 0:09:47.880 big lately. So UM. Google is supposedly hogging the YouTube metadata, 0:09:48.200 --> 0:09:51.080 which is preventing Microsoft from making a decent app for it. 0:09:51.840 --> 0:09:55.120 Yeah and UM and Google's like, well, it's proprietary or whatever, 0:09:55.160 --> 0:09:57.000 and I was like, no, you gotta kind of have 0:09:57.040 --> 0:10:00.480 to share that. That's they're alleging in an antitrust violation. 0:10:00.920 --> 0:10:03.800 Companies kind of police one another with that. And then 0:10:03.800 --> 0:10:05.760 also price fixing is a big one, which is like 0:10:05.800 --> 0:10:08.880 the opposite of companies policing one another. It's collusion between 0:10:08.920 --> 0:10:13.480 companies and like Apple and book publishers, UM fixing the 0:10:13.520 --> 0:10:17.959 prices of e books allegedly has been going on. Yeah, yeah, man, 0:10:18.000 --> 0:10:19.920 It's going on all over the place that it's it's 0:10:19.920 --> 0:10:24.720 a dirty, dirty, dirty world bribery one of the oldest 0:10:24.800 --> 0:10:28.440 tricks in the book. Um, obviously that's involves some sort 0:10:28.480 --> 0:10:33.280 of a payoff or a kickback in exchange for uh 0:10:33.679 --> 0:10:37.520 whatever information. Um, I get the bid, my company gets 0:10:37.679 --> 0:10:40.160 your bid for this government job, and I get a 0:10:40.200 --> 0:10:44.199 little kickback or I give you a little kickback rather um, 0:10:44.240 --> 0:10:48.520 any kind of maybe favorable decision that can influence your company. Yeah, 0:10:48.679 --> 0:10:51.720 little little grease in the palm going on. Here's three 0:10:51.960 --> 0:10:57.640 high quality frozen steaks. Please consider it, and you say 0:10:57.679 --> 0:11:01.360 consider granted. And within each of these steaks is a 0:11:01.440 --> 0:11:05.080 one million dollar bill. It's not even eating. That doesn't 0:11:05.120 --> 0:11:08.000 even exist. What frozen steaks with money in them? A 0:11:08.000 --> 0:11:11.120 million dollar bill? Okay, we know about frozen deutsch marks. 0:11:11.280 --> 0:11:13.440 Somebody sent us a dollar. By the way, I want 0:11:13.440 --> 0:11:15.800 the dollar. We'll we'll give you fifty cents, all right, 0:11:16.120 --> 0:11:17.680 I guess it's thirty three and a third we gotta 0:11:17.679 --> 0:11:21.320 give Jerry or cut. Don't go there. We'll talk about 0:11:21.320 --> 0:11:27.080 it later. Embezzlement Office Space. Everyone's seen the movie Office Space. 0:11:27.480 --> 0:11:29.559 A little program they had to like shave a sin 0:11:29.679 --> 0:11:34.240 or something off of transaction that's embezzlement. They were given 0:11:34.280 --> 0:11:39.880 the opportunity through trust with books, with accounting, they basically 0:11:39.920 --> 0:11:43.120 add access to the money and skim them off the top. 0:11:42.200 --> 0:11:47.439 A wrong guys, money laundering, which we have done a podcast. 0:11:47.480 --> 0:11:55.640 One schemes, yeah, on tax evasion. UM. So basically all 0:11:55.679 --> 0:11:58.160 of the those are all the stars. There's also other 0:11:58.200 --> 0:12:03.400 ones like UM snage, industrial espionage, corporate spelling, secrets its 0:12:03.440 --> 0:12:06.520 white collar. UM. Remember the lady who tried to sell 0:12:06.520 --> 0:12:10.480 Pepsi's secrets coke? Yeah, that was pretty hackney, no Coke's 0:12:10.480 --> 0:12:13.600 secret of pepsi because she's like, wait right here, she 0:12:13.679 --> 0:12:15.600 wasn't anyone called the cops. She didn't do a real 0:12:15.600 --> 0:12:20.600 good job. That's she was surprised. UM. Environmental law violations 0:12:20.600 --> 0:12:24.640 like dumping toxic waste, Yeah, covering that up like Aaron 0:12:24.640 --> 0:12:27.959 Brockovich style. UM. One of the things they point out 0:12:27.960 --> 0:12:29.679 in here, which is when it comes to things like 0:12:30.440 --> 0:12:35.800 your a little office space scheme that you just touted, UM, 0:12:35.840 --> 0:12:38.640 a lot of times it's difficult to imagine victims, Like 0:12:39.200 --> 0:12:41.800 in the office space, they think no one's gonna min 0:12:42.280 --> 0:12:45.800 miss a Penny is a huge company, So you commit 0:12:45.880 --> 0:12:49.880 these crimes without realizing that someone has hurt somewhere down 0:12:49.920 --> 0:12:52.680 the line. If you dump your stock, your company stock 0:12:52.760 --> 0:12:54.800 that you know is about to tank. And I'm not 0:12:54.840 --> 0:12:58.200 saying it's understandable, but if you've like worked your whole 0:12:58.240 --> 0:13:01.599 career in sting in this company with your four O 0:13:01.679 --> 0:13:04.320 one k you know it's about to tank, You're like, man, 0:13:04.440 --> 0:13:06.520 I need to sell this or else I'm done for. 0:13:06.960 --> 0:13:09.640 My family's done for. You don't think about the people 0:13:09.720 --> 0:13:13.840 buying the stock. They're the victims. No, it's absolutely true, 0:13:13.880 --> 0:13:17.760 And I mean like you are being pawned. You're pawning 0:13:17.760 --> 0:13:20.040 your problem off on somebody else. But I think you 0:13:20.120 --> 0:13:25.400 paint a really really excellent scenario. Like you can in 0:13:25.480 --> 0:13:29.599 some cases feel bad for the white collar criminal um, 0:13:29.840 --> 0:13:32.360 especially if it's just some average Joe who's worried about 0:13:32.400 --> 0:13:35.079 is four oh one k um or in the case 0:13:35.120 --> 0:13:38.600 of en Ron, you don't feel bad for the upper dudes. 0:13:38.840 --> 0:13:42.079 You feel bad for everyone in that company that got defrauded, right, 0:13:42.080 --> 0:13:44.640 But they were strictly victims. They didn't didn't turn around 0:13:44.679 --> 0:13:46.839 and like try to dump the stocks. But that that's 0:13:46.880 --> 0:13:50.800 a very visible case of like screwing over your own employees. 0:13:50.960 --> 0:13:52.680 But you make a good point like even if the 0:13:52.880 --> 0:13:55.680 even if the criminal is sympathetic, there still is a victim. 0:13:55.760 --> 0:13:59.680 Even if it's just some amorphous trader, they will never meet, 0:13:59.720 --> 0:14:03.000 even if the victim is some like hedge fund manager. Yeah, 0:14:03.400 --> 0:14:06.959 it's really tough. There's like a really weird spectrum here. 0:14:07.000 --> 0:14:09.080 There's like I don't know if it's a bell curve 0:14:09.320 --> 0:14:14.920 or like, uh, the UV spectrum. Who knows. But there's 0:14:15.000 --> 0:14:19.440 sympathies like placed in different spots, sympathies and anti antipathies 0:14:20.080 --> 0:14:23.680 placed along this this depending on who did what and 0:14:23.680 --> 0:14:26.560 what they gained from it and what their motives were agreed, 0:14:26.800 --> 0:14:29.600 because you gotta also have credit card fraud and computer 0:14:30.360 --> 0:14:34.600 and mail fraud and counterfeiting and things like that, like 0:14:34.720 --> 0:14:38.360 you know the Nigerian email scams. That's white collar, but 0:14:38.760 --> 0:14:40.520 and they're in the same boat as like ken Ley 0:14:40.520 --> 0:14:45.280 and Jeff Skillings and Ron exactly same scummy crooks. Or 0:14:45.360 --> 0:14:47.600 let's say you commit a little credit card fraud and 0:14:47.760 --> 0:14:50.600 you or bankruptcy fraud and you're just like, does it 0:14:50.720 --> 0:14:52.320 be easy way to get out of my debts? Or 0:14:52.400 --> 0:14:55.040 I just say someone stole my credit card. It's very 0:14:55.040 --> 0:14:58.800 easy there to not envision a a victim because it's 0:14:59.480 --> 0:15:02.800 it's cha Manhattan Bank, and like they're gonna notice. But 0:15:02.840 --> 0:15:05.400 what happens is they raise the rates on you and me, 0:15:06.560 --> 0:15:08.800 and all of a sudden, everyone across the board is 0:15:08.800 --> 0:15:13.360 paying more money for stuff. Yes, that is that is true. 0:15:15.360 --> 0:15:19.480 That is very true, and that is I think everybody's probably. 0:15:19.520 --> 0:15:21.360 I think a good companion piece that occurred to me 0:15:21.440 --> 0:15:24.000 is to go listen to our wide corporations of the 0:15:24.000 --> 0:15:27.520 same rights as you. One of the fundamental flaws of 0:15:27.760 --> 0:15:32.680 UM corporate policy is that you served your shareholders first, right, 0:15:33.160 --> 0:15:36.040 like you need to adhere to the law, but really, ultimately, 0:15:36.120 --> 0:15:39.480 like anything you can do to serve your shareholders is 0:15:39.760 --> 0:15:44.240 your mandate as a as a corporate governor. UM. That 0:15:44.280 --> 0:15:48.280 includes keeping the profit margin as high as possible, which 0:15:48.440 --> 0:15:51.320 you're not gonna go to your your shareholders and be like, hey, 0:15:51.440 --> 0:15:53.600 we're making enough money. We took kind of a hit, 0:15:53.840 --> 0:15:57.000 but we're still making a ton of profit, so we'll 0:15:57.000 --> 0:16:00.440 just take a little hit this year. No, it's where 0:16:00.480 --> 0:16:04.000 we took a hit, so we're gonna fire people. However, 0:16:04.040 --> 0:16:06.920 you reconcile that, I mean, that's your own personal beliefs, 0:16:06.960 --> 0:16:09.480 Like what what you feel about that but that is 0:16:09.880 --> 0:16:13.480 reality as far as business goes, Right, there's fraud, there's 0:16:13.520 --> 0:16:16.720 adjustments to the fraud. There absorbing the fraud, and it's 0:16:16.920 --> 0:16:19.880 the corporation trying to get as lean as possible. Yeah, 0:16:19.880 --> 0:16:22.080 they're not gonna take the hit for that. They're not 0:16:22.120 --> 0:16:25.240 gonna say, oh, well, a bunch of people defaulted on 0:16:25.280 --> 0:16:27.040 their credit cards this year. I guess we'll just have 0:16:27.080 --> 0:16:30.280 a bad year. And I know in reality that's how 0:16:30.320 --> 0:16:33.320 it works, but I just find it disingenuous to be like, well, 0:16:33.400 --> 0:16:36.680 everybody suffers, you know, like people lose their jobs because 0:16:36.680 --> 0:16:39.320 of fraud. It's like there's a there's a point b 0:16:39.560 --> 0:16:41.800 in there that that has to be held accountable to 0:16:41.920 --> 0:16:46.200 some degree, well, which is your own freaking ethical code 0:16:46.200 --> 0:16:48.680 of conduct, and like about not doing that because it's 0:16:48.680 --> 0:16:50.280 the wrong thing to do. No, but I'm saying, like, 0:16:50.320 --> 0:16:53.360 there's an institution that's absorbing the hit and then turnerund 0:16:53.400 --> 0:16:57.320 firing this poor guy. Yeah, exactly. It's just it's tough 0:16:57.360 --> 0:17:01.120 because I came across a word when they were describing 0:17:01.120 --> 0:17:04.040 white collar crime giving a definition of it, and they said, 0:17:04.119 --> 0:17:09.399 victims coling diffuse. Yeah, you don't meet the person the 0:17:09.400 --> 0:17:13.480 the victim passes along the hit to other people. It's 0:17:13.520 --> 0:17:17.399 a big it's nebulous. And even if they're raising rates 0:17:17.440 --> 0:17:20.400 by like a quarter of a percentage point, or you're 0:17:20.440 --> 0:17:23.080 paying an extra two dollars as a consumer a year, 0:17:23.880 --> 0:17:32.080 it's like it's still not right. Yeah, you know, jo 0:17:42.880 --> 0:17:55.560 m hm. So where did this come from? Uh? Josh, 0:17:55.560 --> 0:17:58.359 it came. It sounds like it came from a cold, 0:18:00.000 --> 0:18:04.000 fool delivery boy. I want to know more about this. 0:18:04.080 --> 0:18:05.760 Was this dude just cold or did he really steal 0:18:05.760 --> 0:18:07.760 a lot of wool? Now, so you're talking about the carriers, 0:18:07.760 --> 0:18:11.560 the Carrier's Case of fourteen seventy three, it's the first 0:18:11.960 --> 0:18:16.520 um white collar trial, yes, um, and and it resulted 0:18:16.560 --> 0:18:19.760 in the first white collar law in fifteenth century England. 0:18:19.920 --> 0:18:23.200 And this wool transporter was given a bunch of wool 0:18:23.240 --> 0:18:26.199 and said, hey, take this wool to this person, and 0:18:26.240 --> 0:18:29.600 it was his job, so he decided to instead just 0:18:29.720 --> 0:18:32.080 keep the wool for himself for his own use. So 0:18:32.119 --> 0:18:33.959 he looked into this more. Yeah, I thought he might 0:18:33.960 --> 0:18:36.199 have been like cold on his journey and said, you know, 0:18:36.200 --> 0:18:38.400 I'm gonna keep some of this woold. Now, he kept 0:18:38.480 --> 0:18:40.320 some of the wool. I think he kept all of it, 0:18:40.840 --> 0:18:42.760 but somebody gave it to him. He's like, thanks chump, 0:18:44.320 --> 0:18:47.080 he was. But the key is, and this is something 0:18:47.119 --> 0:18:50.200 that has has woven into the history of white collar crime. 0:18:51.320 --> 0:18:54.320 What he did was not illegal at the time. The 0:18:54.400 --> 0:18:56.880 law that was enacted as a result of the Carrier's 0:18:57.000 --> 0:19:00.639 case was they were saying, Okay, this isn't oh, this 0:19:00.680 --> 0:19:03.960 isn't illegal, but it's obviously there's a huge problem with this, 0:19:04.040 --> 0:19:06.760 so we're going to create a law that outlaws this 0:19:06.840 --> 0:19:09.800 act so people can't do it anymore. Good point. And 0:19:09.840 --> 0:19:12.320 basically that's what happened. Well, that's kind of what happens 0:19:12.359 --> 0:19:14.240 with every law. I guess, someone commits it first and 0:19:14.240 --> 0:19:16.840 then someone says, hey, maybe we shouldn't do that. Yeah, yeah, 0:19:16.920 --> 0:19:20.720 I guess. But in this case, especially like uh, the 0:19:20.760 --> 0:19:24.359 Industrial Revolution in the West, obviously you started getting these 0:19:24.400 --> 0:19:27.280 larger corporations and all of a sudden, things like monopolies 0:19:27.800 --> 0:19:32.240 and price fixing and employee uh safety and all these 0:19:32.240 --> 0:19:35.720 things come into effect for the first time. So that's 0:19:35.760 --> 0:19:38.000 sort of when it was really born and when they 0:19:38.080 --> 0:19:41.919 started saying, hey, we need to look at something called antitrust. Yeah. Again, 0:19:41.960 --> 0:19:45.760 like monopolies were not illegal, but when a company bought 0:19:45.840 --> 0:19:49.119 up all of its competitors and said, oh, suddenly the 0:19:49.160 --> 0:19:52.680 price for your groceries like through the roof, where else 0:19:52.760 --> 0:19:56.639 you gonna go? It wasn't illegal, but the the people 0:19:56.680 --> 0:20:00.080 of the world started screaming, and governments finally responded, and 0:20:00.080 --> 0:20:02.800 it was really the US that first had the real 0:20:03.359 --> 0:20:06.720 first solid response in the Sherman Anti Trust Act in 0:20:06.760 --> 0:20:10.440 like the eighteen seventies maybe I think eighteen ninety named 0:20:10.480 --> 0:20:15.119 for John Senator John Sherman, Ohio, Republican dude, chairman of 0:20:15.119 --> 0:20:18.119 the Senate's Finance Senate Finance Committee, which I didn't know 0:20:18.160 --> 0:20:21.200 they even had way back then. I forgot didn't either, 0:20:21.280 --> 0:20:23.480 but I mean, it seems like a basic committee there, 0:20:23.920 --> 0:20:26.600 so this is interesting. And that it was voted on. 0:20:27.160 --> 0:20:29.119 It won by a vote of in the Senate fifty 0:20:29.160 --> 0:20:31.600 one to one, in the House by two forty two 0:20:31.640 --> 0:20:35.200 to zero. So there was one dude that didn't vote 0:20:35.240 --> 0:20:38.200 for it. And then I think twenty five years later 0:20:38.240 --> 0:20:40.240 when they came up with the Clayton Anti Trust Act 0:20:40.280 --> 0:20:43.520 to really put some punch into the Sherman Act. It 0:20:43.600 --> 0:20:45.840 was two seventy seven to seventy four and forty six 0:20:45.920 --> 0:20:49.000 to sixteen so in that twenty four years, it sounds 0:20:49.040 --> 0:20:52.880 like maybe things got slightly corrupt here and there. Well 0:20:52.920 --> 0:20:55.560 it wasn't that. It was that. Well, maybe it was, 0:20:56.040 --> 0:20:58.399 but there was also some real problems with the Sherman 0:20:58.440 --> 0:21:02.320 Act that was really vague. It basically said like now, 0:21:02.400 --> 0:21:06.960 from here forth, all um anti competitive corporate measures are illegal, 0:21:07.560 --> 0:21:09.920 and then it left it to the courts to decide 0:21:09.960 --> 0:21:11.879 what was what, and the courts weren't really in the 0:21:11.880 --> 0:21:15.080 mood to enforce it, so it went largely unenforced. Although 0:21:15.640 --> 0:21:19.200 American Tobacco Company and Standard Oil, like two of the 0:21:19.200 --> 0:21:23.400 biggest companies in the country, were dissolved under the Sherman Act, 0:21:23.520 --> 0:21:26.359 Standard Oil big time. Imagine that Like, imagine going to 0:21:26.600 --> 0:21:30.520 a company now and saying like, hey, Apple, it's just 0:21:30.560 --> 0:21:33.680 too big, so we're gonna dissolve you into thirty one companies. 0:21:34.080 --> 0:21:36.240 We have all these federal regulators here and they're gonna 0:21:36.240 --> 0:21:38.199 come in and look at everything and the dissolve you 0:21:38.200 --> 0:21:43.120 into different companies. Sorry, that's what they did. Okay, Even still, 0:21:43.160 --> 0:21:44.560 it didn't have enough tea. So they came up with 0:21:44.600 --> 0:21:47.320 the Clayton Anti Trust Act, and then that one really 0:21:47.359 --> 0:21:51.280 spelled things out, like, um, you couldn't do price discrimination anymore, 0:21:51.840 --> 0:21:54.920 which if you were black in America during the Jim 0:21:54.960 --> 0:22:00.640 Crow era, price discrimination was mind boggling. You walk into 0:22:00.640 --> 0:22:02.679 a store if you're allowed in there to begin with, 0:22:03.000 --> 0:22:05.800 and they'll just make up whatever price they want. It's 0:22:05.880 --> 0:22:09.200 it was really I'm reading this, um Consumerism an America book, 0:22:09.240 --> 0:22:12.359 and it's at this point now is really just this 0:22:13.480 --> 0:22:17.400 blemish on American history. I mean, like slavery wasn't bad enough. 0:22:17.480 --> 0:22:21.200 I mean to like have slavery light through the Jim 0:22:21.240 --> 0:22:25.639 Crow era, it's just disgusting. Um. Okay, So there was 0:22:25.680 --> 0:22:31.119 no price discrimination allegedly, corporate mergers were outlawed in the 0:22:31.160 --> 0:22:34.840 Clayton yeah. Um. And then interlocking boards where you had 0:22:34.880 --> 0:22:37.760 like competitive companies but the same people on the board 0:22:37.760 --> 0:22:40.480 of each Right, you can't have that. And then also 0:22:40.520 --> 0:22:45.240 exclusive contracts where it's like hey, Home Depot, you can 0:22:45.280 --> 0:22:49.320 sell our um weed whackers, but you can't tell anybody 0:22:49.320 --> 0:22:53.480 else's those contracts are out right, Hey Home. They do 0:22:53.520 --> 0:22:57.080 stuff like that now though, right, maybe not exclusively, but 0:22:57.119 --> 0:22:59.359 they carry lives. They do not limited number of brands, 0:22:59.440 --> 0:23:04.159 corporate mergers, interlocking boards, exclusive contracts, all that stuff one 0:23:04.160 --> 0:23:07.280 a way. They all got chipped away. Okay, it's just 0:23:07.359 --> 0:23:10.560 I mean this, this this act is like not in 0:23:10.720 --> 0:23:13.240 force anymore. Basically. Well, that's one things that bugs me 0:23:13.280 --> 0:23:17.159 about like grocery or actually the big box hardware stores. 0:23:17.480 --> 0:23:21.600 Grocery shopping, you you only have access to what they 0:23:22.160 --> 0:23:24.760